Norsk Hydro

Norsk Hydro has set a target for net-zero scope 1 and 2 emissions by 2050 or earlier, with intermediate targets incentivising near-term action towards its long-term goal. Additionally, the company provides targets for all relevant scopes of emissions in its supply chain, including its indirect emissions. The company discloses important data on its upstream emissions that allows for an understanding of the carbon footprint of its cradle-to-gate aluminium products.

No leading practices were identified for this company.

No leading practices were identified for this company.

No leading practices were identified for this company.

Norsk Hydro has set a long-term net-zero target. However, it has not set sufficient intermediate emissions targets. Setting regularly spaced intermediate targets at intervals gaps of no more than five years will further incentivise near-term action towards the company’s long-term goal.

Although, Norsk Hydro provides comprehensive reporting of how it employs climate change scenario analysis in its 2023 report, this falls out of the scope of the timeline for the current benchmark assessment. The company provides evidence of some low-carbon activities; however, the company doesn’t report sufficient growth plans or financial details for them. To improve its credibility and substantiate the development of its low-carbon business activities, the company should report their profitability, current size, growth potential and deployment details.

Norsk Hydro discloses its research and development (R&D) expenditure for the past three years. However, no company activity was observed related to patenting of low-carbon technologies. Additionally, the company fails to provide quantitative data regarding its investment in low-carbon technologies, specifically a breakdown of its investments in both mature- and non-mature climate technologies.

Although Norsk Hydro emphasises collaboration with suppliers to develop sustainable solutions to reduce emissions, it lacks explicit emissions reduction or reporting obligations for its suppliers, which hinders its upstream emissions reduction efforts. Similarly, the company provides examples of how it collaborates with clients to promote low-carbon products but does not provide details on the scope of its client engagement strategy. Norsk Hydro has made its engagement policy public, but it is unclear if this policy extends across the entire organisation. Moreover, while the company outlines its political engagement strategy, there is lack of detail on how it monitors and reviews the climate policies of its industry associations and alliances.

Norks Hydro is committed to achieving net-zero scope 1 and 2 emissions by 2050 or earlier. It also has an intermediate commitment to reduce 30% of its total direct and upstream emissions by 2030 compared to its 2017 baseline.

The company claims that R&D in decarbonisation solutions will be a growing activity in its transition roadmap, noting carbon capture and storage and proprietary technology as the prime enablers. However, there is no evidence that the company reports its expenditure on low-carbon R&D.

The company consistently reports emissions intensity data for its electrolysis and refining processes. In 2017-2022, the company saw a 4% reduction in the emissions intensity for both processes.

In 2022, the company expanded its production of low-carbon aluminium. In the same year, around 30% of its revenue was reported to come from low-carbon products. According to company reporting, 41% of the company’s energy consumption comes from renewable energy.

Norks Hydro has a low-carbon transition plan that sets out targets for 2025, 2030 and 2050. It focuses on innovation, increasing recycling capacity and renewable energy generation. The company briefly describes activities that it plans to undertake to achieve its targets and the financial implications.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders. No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

The company has a commitment to create and support access to green and decent jobs as part of the low-carbon transition. Furthermore, it discloses the actions it takes to create local jobs at its new aluminium recycling plant in Cassopolis, US. However, no evidence was found of the company’s actions to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. No relevant disclosure was found of the company’s assessment of employment dislocation risks. The company has a commitment to reskill and upskill workers and stakeholders affected by the low-carbon transition and discloses the actions it takes in this regard. For instance, it supports communities through apprenticeships where apprentices can develop hands-on vocational skills. Furthermore, the company discloses the measures it takes to embed equality of opportunity for women and vulnerable groups in these actions. However, no relevant disclosure was found of the company having a process for identifying skills gaps for workers and affected stakeholders in the context of the transition.

No relevant disclosure was found to show if the company identifies the impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to their social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights and the ILO fundamental rights at work, and it expects its business relationships to respect the ILO fundamental rights at work. Furthermore, the company discloses a human rights due diligence process that includes the identification and assessment of salient human rights risks, such as modern slavery, forced labor and child labor abuse, as well as rightful, respectful and lawful resettlement, relocation and repossession. The company takes actions to mitigate these risks in its own operations and supply chain and engages with affected stakeholders. Additionally, the company has a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment from its business relationships. While the company provides evidence of how it determines a living wage for the regions where it operates, no evidence was found of the company having a time-bound target for paying all workers a living wage. The company states that workers shall not be required to work more than 48 hours in a regular work week or 60 hours including overtime. No evidence was found that the company discloses the proportion of its direct workforce covered by collective bargaining agreements. The company discloses indicators of workforce diversity, such as the age, gender and region of its workforce by employee category. No evidence was found that the company commits to gender equality and women’s empowerment.

The company commits to protecting personal data, but no evidence was found of the company having a privacy statement regarding the collection, sharing and access to personal data. The company discloses its global tax strategy and the corporate income tax it pays in each relevant jurisdiction. It also has a policy prohibiting bribery and corruption, and it includes corresponding clauses in its business relationship contracts. While the company specifies that it does not make political contributions, no evidence was found that it has a lobbying and political engagement policy.